Progress in selling four small European space businesses resulting in a net $0.07 per share loss on the divestitures (including $0.18 per share tax benefit);

Operating margins (excluding the $9 million pretax loss from selling the European space businesses) were 10.4%, up from 9.1% a year ago;

Strong cash flow from operating activities.

Segment Results

Total Aircraft Controls sales in the quarter were $268 million, up 6% year over year. Military aircraft sales of $128 million were 6% higher. F-35 Joint Strike Fighter sales were up 26%, to $27 million. Other OEM sales were up 8%, to $53 million. Military aftermarket sales were $48 million, down slightly on lower B-2 spares and C-5 modernization activity.

Commercial aircraft revenues increased 5%, to $141 million. Sales of OEM products to Airbus increased 40%, to $35 million, including a 72% increase in A350 program sales. Boeing OEM sales were flat at $61 million. Commercial aftermarket sales were off marginally, at $27 million, due to lower initial provisioning of 787 and A350 spares.

Space and Defense segment sales were $93 million, up 11% year over year. Space sales were 13% higher, attributed to strong space avionics and satellite engine sales. Defense sales were up 10% on increased demand for ground vehicle, missile and naval products.

Industrial Systems segment sales in the quarter were $112 million, down 10%. Energy sales were off 6% and industrial automation sales were off 9%. Simulation and test sales were down 16% from last year’s strong first quarter.

Components segment sales in the quarter were $116 million, up 10% from a year ago, with sales increases seen in each of the three major markets. Aerospace and defense sales of $39 million were 11% higher largely attributed to sales for Northrop Grumman’s Guardian program. Medical market sales of $48 million were up 11% on increased sales of pumps and associated products. Industrial product sales for specialty markets were up 6%.

Consolidated year-end 12-month backlog was $1.2 billion.

Fiscal 2017 Outlook

The Company provided its initial projections for fiscal 2017.

Forecast sales of $2.42 billion, up 1% over last year, down $20 million from last quarter’s forecast;

Forecast earnings per share of $3.50, plus or minus $0.20, unchanged from last quarter’s forecast;

Forecast full year operating margins of 10.0%, down slightly from last quarter’s forecast due to loss on divestitures;

Another year of solid cash flow from operations.

“Earnings per share before specials of $0.91 were above our guidance from 90 days ago,” said John Scannell, Chairman and CEO. “It was a good start to the year and it puts us on track for our full year guidance. Most of our businesses have stabilized since this time last year and we are seeing positive results from restructuring and our portfolio reviews of the past few years.”

In conjunction with today’s release, Moog will host a conference call beginning at 10:00 a.m. ET, which will be broadcast live over the Internet. John Scannell, Chairman and CEO, and Don Fishback, CFO, will host the call. Listeners can access the call live or in replay mode at www.moog.com/investors/communications. Supplemental financial data will be available on the webcast web page 90 minutes prior to the conference call.

Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog’s high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, wind energy, marine and medical equipment. Additional information about the company can be found at www.moog.com.

Information included or incorporated by reference in this report that does not consist of historical facts, including statements accompanied by or containing words such as "may," "will," "should," "believes," "expects," "expected," "intends," "plans," "projects," "approximate," "estimates," "predicts," "potential," "outlook," "forecast," "anticipates," "presume" and "assume," are forward-looking statements. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance and are subject to several factors, risks and uncertainties, the impact or occurrence of which could cause actual results to differ materially from the expected results described in the forward-looking statements. These important factors, risks and uncertainties include:

the markets we serve are cyclical and sensitive to domestic and foreign economic conditions and events, which may cause our operating results to fluctuate;

we operate in highly competitive markets with competitors who may have greater resources than we possess;

we depend heavily on government contracts that may not be fully funded or may be terminated, and the failure to receive funding or the termination of one or more of these contracts could reduce our sales and increase our costs;

we make estimates in accounting for long-term contracts, and changes in these estimates may have significant impacts on our earnings;

we enter into fixed-price contracts, which could subject us to losses if we have cost overruns;

we may not realize the full amounts reflected in our backlog as revenue, which could adversely affect our future revenue and growth prospects;

if our subcontractors or suppliers fail to perform their contractual obligations, our prime contract performance and our ability to obtain future business could be materially and adversely impacted;

contracting on government programs is subject to significant regulation, including rules related to bidding, billing and accounting kickbacks and false claims, and any non-compliance could subject us to fines and penalties or possible debarment;

the loss of The Boeing Company as a customer or a significant reduction in sales to The Boeing Company could adversely impact our operating results;

our new product research and development efforts may not be successful which could reduce our sales and earnings;

our inability to adequately enforce and protect our intellectual property or defend against assertions of infringement could prevent or restrict our ability to compete;

our business operations may be adversely affected by information systems interruptions, intrusions or new software implementations;

the failure or misuse of our products may damage our reputation, necessitate a product recall or result in claims against us that exceed our insurance coverage, thereby requiring us to pay significant damages;

our operations are subject to environmental laws, and complying with those laws may cause us to incur significant costs; and

we are involved in various legal proceedings, the outcome of which may be unfavorable to us.

These factors are not exhaustive. New factors, risks and uncertainties may emerge from time to time that may affect the forward-looking statements made herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. We disclaim any obligation to update the forward-looking statements made in this report.

Contact Us

Phone: 716-687-4225.
Email: investorrelations@moog.com

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